General Motors (A Division of the U.S. Treasury)

Ok, seriously I don't even know where to begin to explain what went wrong here. The major U.S. car makers have been getting their butts kicked by foreign manufacturers for years. Basically everybody involved with these companies was to blame. Until recently these problems were left to GM to solve since they are, after all, GM's problems. This is one of the hallmarks of the American economic system, and one of our greatest strengths. The creativity and rapid advancement that stems from such individual economic freedoms is what made America great. The flip side of this is that every once in a while our economy will stumble, and the current deleveraging was a long time coming. What really makes this recession unique is the willingness on the part of Americans to tolerate such huge changes in the scope of government involvement in our lives and economy.

A case in point is that the government went from basically making loans to GM and Chrysler to forcing the resignation of GM's CEO in very short order. It is shocking that such a thing could happen in the U.S. without huge public debate or outrage, but it did and with barely a whisper of protest. Don't worry, it gets even worse - the article linked to in this post's title details the horrors of government intrusion. Barely had 24 hours passed on Obama forcing Waggoner out and now there is talk of dictating who can serve on the board of directors. It's now official folks: General Motors is a de facto state owned and operated company! The really incredible part of all this is that by replacing Waggoner Obama is implying that he believes that his administration is better suited to pick leaders to run companies than shareholders. I doubt very much that Obama has the industry knowledge possessed by, oh I don't know, Waggoner! Not to mention the fact that the President's track record of nominating leaders is not very good - just look at his nominations for cabinet positions. This is just one more brick in what is turning out to be a fairly short road to socialism and this administration is barely 60 days old.



The precedents set with GM and the current economic stimulus and bailout plans will have long reaching and I fear disastrous consequences for the long-term vitality of our economy.